Opening Market Commentary For 12-27-2012
Premarket was up from yesterday’s close, but below yesterday’s midday high. In other words nothing has changed. I do not expect today or tomorrow to be anything more than what we have already seen this week and will only make one post today as I enjoy the afternoon with my family.
Market opened flat as a pancake with a bearish slant which is to be expected along with HFT algo interference. Red volume is anemic of course as traders continue to sit back and wait for any fiscal cliff news.
By 10 am the markets have distinct bearish slant after Senator REID SAYS `IT LOOKS LIKE’ U.S. WILL GO OVER FISCAL CLIFF! But will they drop further remains to be seen.
Agreed. Unless a miracle happens this market is going to be very quiet today. Continuing claims was 10K lower and continuing claims climbed higher than analyst expected.
“Volume was very light yesterday, and while it may pick up a little today, it’s silly to expect a normal day of trading today or tomorrow. . . With the fiscal cliff looming and the high possibility of a quick move in either direction, there has been no sense pressing trades. . . The Dow has taken out a prior low. The [Nasdaq] broke out but could not hold resistance. The S&P hit a higher high but has given everything back; the index is unchanged over the last couple weeks. The Russell is doing the best.
The RRR** has been narrow at the opening bell for the past several months and continued the trend again this morning. This continuing trend makes predictions of session movements nearly impossible making trading futile and unprofitable. The rest of the week promises little improvement bu but be on the outlook for a ‘fiscal cliff’ movement that bounces both ways.
As long as market volume remains light or the trading range is narrow, one can expect successful trading to remain elusive. The RRR** has been wider on volatile sessions lately and is expected to become more so as 2012 ends and 2013 begins, but a lot of guessing remains. Correctly ‘guessing’, of course, is the tricky part of the successful trading equation. Any trades today will probably end up on the meager side of profitability if you are lucky as most trades have been less than optimal during the past year.
I also have continuing issues with some pundits, writing almost every day, that there are setups for day trading. This week is going to be terrible if you can find a setup at all, the trading range is so narrow that way too money has to be put on the table just to get back meager gains. Do not fall into the trap of money burning a hole in your pocket, sit tight better days are coming. Watch for increasing volume to signal improved trading.
Swing trading is also at your own risk for all the reasons mentioned above. Because the market is at a crossroads of sorts, I would prefer to sit on my hands as the markets are currently untradable. Guessing where the market is going to be tomorrow or next week, at this time anyway, can be a foolish and costly endeavor.
The DOW at 10:15 is at 13104 down 8 or -0.06%.
The SP500 is at 1418 down 1.53 or -0.11%.
SPY is at 141.58 down 0.19 or -0.13%.
The $RUT is at 838.46 down 0.43 or -0.05%.
NASDAQ is at 2986 down 3.36 or -0.11%.
The longer trend is up, the past months trend is bullish and the current bias is down.
WTI oil was up this morning and is currently trading down at 91.07 trading between 90.75 and 90.43 and the bias is negative.
Gold has been trading sideways this morning. Currently trading up at 1656.95, trading range is between 1653.45 and 1659.00 with a negative bias.
Dr. Copper is at 3.60 up from 3.59 earlier.
The US dollar fell from 79.70 earlier to 79.42 and is currently trading down at 79.51.
** RRR = Risk Reward Ratio
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Written by Gary